TA Rebates

[cruiseluv]

Isn't there a place where TA's can debate this? Exposing this information to passengers/clients can only cause problems (IMHO). I don't care what my TA's commission is -- they earn it. I accept whatever they offer to us in terms of rebates. This, IMO, is not a discussion that should be held with your customers.

 

What do you mean "Isn't there a place where TA's can debate this"? I'm not a TA, I'm a consumer/ customer. Why can't we debate it? I rather talk about this that about if jeans are acceptable the last night of the cruise.

[Travelcat2]

What do you mean "Isn't there a place where TA's can debate this"? I'm not a TA, I'm a consumer/ customer. Why can't we debate it? I rather talk about this that about if jeans are acceptable the last night of the cruise.

 

You are entitled to your opinion. BTW, no one is talking about if jeans are acceptable the last night of the cruise. They are -- it is part of the dress code. There is a question on the table but that isn't it

[tallship]

What do you mean "Isn't there a place where TA's can debate this"? I'm not a TA, I'm a consumer/ customer. Why can't we debate it? I rather talk about this that about if jeans are acceptable the last night of the cruise.

 

Agree. I have found this to be a most informative thread and I appreciate hearing all of the varied input. I also feel that some customers have their TAs do a lot more than I have needed and those TAs should be compensated for that service. But, I also have met a lot of guests recently receiving real perks such as significant OBCs and free upgrades and it is nice to share and learn about that info as well.

[cruiseluv]

Agree. I have found this to be a most informative thread and I appreciate hearing all of the varied input. I also feel that some customers have their TAs do a lot more than I have needed and those TAs should be compensated for that service. But, I also have met a lot of guests recently receiving real perks such as significant OBCs and free upgrades and it is nice to share and learn about that info as well.

 

Great point Tallship. People should not be afraid from seeking information. If after acquiring new information they conclude they're comfortable with their course of action, great!

[cwn]

Agree. I have found this to be a most informative thread and I appreciate hearing all of the varied input. I also feel that some customers have their TAs do a lot more than I have needed and those TAs should be compensated for that service. But, I also have met a lot of guests recently receiving real perks such as significant OBCs and free upgrades and it is nice to share and learn about that info as well.

 

I agree with you also...this has been a great thread. I did some shopping on for our next Regent cruise and was amazed at what was out there. Up untill now I thought ~5% of the cruise only cost in OBC was good, since if we didn't use it, we got it back in cash. Now I know we left $$$ on the table.

 

Think I will go for the $$$ saved on the cruise, since I do the planning and let AMEX Travel do most of the reserving. They have always been helpful if there was a problem I couldn't handle.

[Seabourntraveller]

If you'd like to PM me I'd be happy to discuss offline.

 

However you are mistaken in your assertion. Overrides are the additional percentage points which make up that 15% commission instead of the "base" of 10%, or the 17% instead of the 10%. So in effect, the "override" is what gives an agency a higher commission - it's not something over and above.

 

I don't want to talk about this too much on what is a public forum, but did want to correct any mis-assumption, and again, please feel free to PM me should you wish to discuss offline further.

 

I am not talking about the overide amount above 10% ...I am quite familiar with the whole process. I am referring to the HUGE sales bonuses the cruiselines give for acheiving 100% and above sales quotas that are in a tiered format starting at 25K 45K and 75K and above for top performing agencies. :eek:

[commodore2010]

What a great thread and very interesting reading.

 

As I said in another related thread, the cruise lines will ultimately make the business decision on whether rebating stays or goes. Looks like Carnival is making a move. The biggest is usually first and then the others will follow if there is no backlash.

 

What will be really interesting over the next 10 years is whether the cruise lines move away all together from the Agency model. Apparently the expense of beefing up call centers off sets the commission payouts. There will be a day, especially as the younger generation is used to doing it themselves (mostly online), that Carnival/RCCL will see the opportunity to improve thier profits. First lowering the commissions to see the effect and then just eliminating them ala the airlines.

 

I would not want to be an intermediary in the travel business. Not good long term prospects.

[YYC F/A]

I am not talking about the overide amount above 10% ...I am quite familiar with the whole process. I am referring to the HUGE sales bonuses the cruiselines give for acheiving 100% and above sales quotas that are in a tiered format starting at 25K 45K and 75K and above for top performing agencies. :eek:

 

I'd check your sources. I think you are getting some bogus or out of date information. ;)

 

Times have changed, the overrides you speak of are percentage point increases over the base of around 10.

 

The cruise lines are not giving "HUGE bonuses" everytime you hit 25k or 45k or 75k in sales - that would be virtually every decent sized travel agency, even a lot of the little mom and pops. Heck, for luxury, one booking is easily 25k. You think agencies are getting "huge bonuses" plus 17% for every luxury booking they do?! I appreciate the morning smile though :D:D

 

In closing though, I hope that everyone on CC here ultimately is happy with their choices, whether it's a good full service luxury specialist that keeps you happy, or a rebating online agency that saves you some extra $. If you're not happy, talk to your agent about it and see if you can't make something work... otherwise, there's a lot of competition out there and consumers have a lot of choices.

 

Happy sailing.

[computerworks]

The cruise lines are not giving "HUGE bonuses" everytime you hit 25k or 45k or 75k in sales

 

I believe SBT meant those numbers as the amount of the bonus due to meeting overall quotas.

[Host Dan]

I'd check your sources. I think you are getting some bogus or out of date information. ;)

 

Times have changed, the overrides you speak of are percentage point increases over the base of around 10.

 

The cruise lines are not giving "HUGE bonuses" everytime you hit 25k or 45k or 75k in sales - that would be virtually every decent sized travel agency, even a lot of the little mom and pops. Heck, for luxury, one booking is easily 25k. You think agencies are getting "huge bonuses" plus 17% for every luxury booking they do?! I appreciate the morning smile though :D:D

 

In closing though, I hope that everyone on CC here ultimately is happy with their choices, whether it's a good full service luxury specialist that keeps you happy, or a rebating online agency that saves you some extra $. If you're not happy, talk to your agent about it and see if you can't make something work... otherwise, there's a lot of competition out there and consumers have a lot of choices.

 

Happy sailing.

Great post!

 

Host Dan

[commodore2010]

I'd check your sources. I think you are getting some bogus or out of date information. ;)

 

Times have changed, the overrides you speak of are percentage point increases over the base of around 10.

 

The cruise lines are not giving "HUGE bonuses" everytime you hit 25k or 45k or 75k in sales - that would be virtually every decent sized travel agency, even a lot of the little mom and pops. Heck, for luxury, one booking is easily 25k. You think agencies are getting "huge bonuses" plus 17% for every luxury booking they do?! I appreciate the morning smile though :D:D

 

In closing though, I hope that everyone on CC here ultimately is happy with their choices, whether it's a good full service luxury specialist that keeps you happy, or a rebating online agency that saves you some extra $. If you're not happy, talk to your agent about it and see if you can't make something work... otherwise, there's a lot of competition out there and consumers have a lot of choices.

 

Happy sailing.

 

I believe the poster meant that the cruise lines pay year end bonuses of $25, 45, 75K if the agency hit year sales goals of lets say $10 million or whatever is negotiated.

[YYC F/A]

I believe the poster meant that the cruise lines pay year end bonuses of $25, 45, 75K if the agency hit year sales goals of lets say $10 million or whatever is negotiated.

 

Ah, ok, I misunderstood - apologies...

 

Yes, for the very large $10/million type accounts, there could be an annual performance bonus or such - though oftentimes there are marketing spend requirements for these type of arrangements and it's to help offset marketing spend... Also a $50k bonus may sound huge, but is pretty small when factored into the volume and number of actual bookings - for mass market cruise lines where that level of sales requires hundreds or thousands of individual bookings, it's maybe only $10-$15 per booking "bonus".

[rlimbacher]

What a great thread and very interesting reading.

 

As I said in another related thread, the cruise lines will ultimately make the business decision on whether rebating stays or goes. Looks like Carnival is making a move. The biggest is usually first and then the others will follow if there is no backlash.

 

What will be really interesting over the next 10 years is whether the cruise lines move away all together from the Agency model. Apparently the expense of beefing up call centers off sets the commission payouts. There will be a day, especially as the younger generation is used to doing it themselves (mostly online), that Carnival/RCCL will see the opportunity to improve thier profits. First lowering the commissions to see the effect and then just eliminating them ala the airlines.

 

I would not want to be an intermediary in the travel business. Not good long term prospects.

 

 

As the former director of revenue management for a major airline, your analysis is a little off base. The airlines are still offering commissions due to the fact that their travel agent partners are the high yield distribution channel. The internet cannot move market share for the airline or a cruise company since it is totally price driven. We discovered that our travel agents were able to shift market share and upsell our product over the online booking channels. Example: Expedia, Orbitz, and Travelocity produce the lowest yields for the airlines. They are simply our "seat fillers" so the flights will fill up. Years ago we all thought if you sold your product via online we would all run to it. Before my retirement we realized that we will have multiple distribution channels and the agency side has consolidated and increased in production. Believe me, we would have went direct if it were profitable. I agree with the other posts that we will have multiple channels in the years to come.

[tallship]

What's interesting is that there are diverse perks assocated with the different channels of distribution

 

Full service luxury TA, non-rebater - experience in the biz and ability to service client needs

Full Service luxury TA that rebates - same as above but builds a loyal and repeat client base

Online, volume discounter - fills the ship, no frills, low price, some OBC, etc

Direct from Regent - offers of upgrades as reported on this board, pricing is relatively static

 

So what's in Regent's best interests over the longer term? My bet is to enhance the direct channel more. What do others think?

[YYC F/A]

What's interesting is that there are diverse perks assocated with the different channels of distribution

 

Full service luxury TA, non-rebater - experience in the biz and ability to service client needs

Full Service luxury TA that rebates - same as above but builds a loyal and repeat client base

Online, volume discounter - fills the ship, no frills, low price, some OBC, etc

Direct from Regent - offers of upgrades as reported on this board, pricing is relatively static

 

So what's in Regent's best interests over the longer term? My bet is to enhance the direct channel more. What do others think?

 

I have to disagree to an extent. Otherwise I wouldn't still be in this business :D

 

Sure, cruise lines will take a direct booking, and be set up to service that direct booking should consumers prefer. And if consumers prefer dealing with a call centre agent - one whom is restricted to providing advice and information only about services offered by the one company that they work for - well sure that's an option and will continue to be.

 

But a cruise is not like a more commodity based airline seat. Folks book leisure air online as it's relatively easy for straightforward point to point flights, and most folks are able to easily compare fares/schedules and then book with whomever offers the cheapest flight at the times they want - it's straightforward, and ultimately you are just booking a bum on a seat to get from A to B.

 

A cruise is different. The itineraries are complex, the differences between the lines are complex, even the differences between the ships within a line can be complex. And a cruise IS the experience, it's not just an A-B 3 hour method of transportation, and for many folks, it'll be one of their biggest single purchases of the year. Agents - particularly niche and specialists - are here to stay, and the cruise lines are investing vast amounts of money in better supporting their key agency partners. NCL is just one example of a line that has come out swinging of late with huge investments in their travel partner distribution channels and trade support. In fact, NCL is actually shrinking their direct booking channels. Over at the river cruise lines, there is one notable exception whom is ramping up direct booking efforts - but the rest of the river cruise players are at the point of almost turning away direct business - having as much as 95+% of business coming through agency partners.

 

And for luxury, it could be argued it's even more important to have the key agency relationship than for the mass market lines. I quote this paragraph from Regent/Oceania yet again, but I think it sums it up better than I could articulate it.

"We believe that supporting travel agency economics is as good for our business as it is for yours, because an upscale cruise vacation is a product that is sold, not bought. Our value propositions needs to be understood, not discounted. And more important than at the larger cruise lines, our success is very dependent on the travel agent’s ability to learn and understand the wants and needs of cruise prospects, to know and be able to articulate the points of distinction, to match the prospect with the right cruise and ultimately, to close and service the customer over the many months from booking to sailing and start the cycle again when they return home."

 

This was already posted by someone else on the cruise critic boards in a different post, and in it's entirety, but I thought I'd parse that paragraph as it seems relevant.

 

Several cruise lines and hotel companies have even stated that they see higher yields on bookings done through travel partners versus those done through direct channels - in some cases more than enough to justify agency commission costs vs. having the in-house staffing and administrative costs of a direct channel.

 

The business has changed, but I'm confident there'll be a niche for specialised agencies. With all the marketing and "in the field" consumer events and activities that specialised cruise line or luxury travel agencies can bring to the table, there is just no way cruise lines can achieve this level of penetration and consumer education of their product on their own. Remember, there is a massive population of potential cruisers out there whom cruise lines are banking on enticing onboard as they grow their fleets. The internet is a great starting resource, but for a product that is as intangible as travel - one that you can't pick up, kick the tires, take for a test spin before dumping down your money - folks often like to interact with a human being first, and not necessarily a call centre agent.

 

But for those that prefer the call centre route, or for all those simple and straightforward 3-night "drive to" Bahamas type cruises targeting the Florida and Southern States markets, sure - the internet and direct booking channels will continue to evolve to support and encourage direct booking of these products.

[rlimbacher]

You brought up some very good points! Well said and appreciated.

I agree 100% with your statements. Thank you for the additions. Ya'll do a fantastic job for us and we really appreciate the service and advice of a great travel agent! I require an advocate on my behalf every time I take a trip. I never "roam alone" and Ms. Internet cannot provide that service. They all need to think about that the next time a volcano erupts in Europe. My travel agent had me home on a flight that was not even available to the regular passengers since they added a section. Saved my days of being stranded in Paris.

[Wendy The Wanderer]

Tina, you have a point, but YYC F/A also makes sense.

 

Many consumers of cruises aren't even sure what line they want to travel, let alone what exact itinerary, what ship, what type of cabin. That's where a TA is needed, for the consumer who needs help. If I was in this situation, I would not trust the cruise line itself to advise me, since they have a vested interest. What comes to mind is avoidance of the "bad cabins", that we've all heard about, and straight talk about extra costs (which is only not relevant for Regent and perhaps other luxury lines.)

[tallship]

Wendy, thx

 

Everything I learned about good/bad cabins was from these boards and posted reviews

 

I like the Regent product as it suits our needs even though things are not always perfection so I do not need a TA to compare lines or give me cabin advice

 

I usually decide what cruise I want, check out the available cabins, book my own air, hotel and excursions, etc

[JoAnne B]

One point that has not been made, unless I missed it, is the difference between full-service agencies that handle the whole package, cruise, air, hotels, transfers, etc. and cruise-only agencies, whether they rebate or not. Years ago we used full-service agencies, as many on the list still do. Inexperienced travelers are especially well served by these agencies. I would still use such an agency for a complex trip. These days my needs are satisfied by a cruise agency. But not just any agency, I am still looking for the same level of service, just a more limited scope. I moved to a long-distance agency years ago, not because of a rebate, but because of her knowledge of the luxury cruise market. I like being able to text any time of day or night and know that the issue will be handled during business hours, rather than playing telephone tag with my busy schedule. I don't need her for air, hotel, or excursions. I need her to make appropriate recommendations, answer questions, and solve problems. She was worth her weight in gold when RSSC lost the Diamond suddenly, leaving existing reservations in chaos. Those situations don't arise often, but they do occur.

 

I appreciate the rebate, but the level of service is always the priority. Once the level of service drops (and I fear it might with changes in affiliations), then the rebate would be inconsequential. Having said that, I think the issue of rebates becomes more relevant as the price tag rises. Is the $20,000 cruise really that much more work for the TA than say a $699 Carnival cruise? Yet the differential for the TA is huge. It seems perfectly reasonable to pass some of this back to the customer. If the TA is able to make a reasonable profit and include rebates in the package, so much the better.

 

But it is important not to confuse the different types of agencies. Those who are TA's can better explain how offering a wide variety of services impacts the cost of doing business. If you require a full-service agency handling a lot of time consuming and low commission details, you are not being ripped off if you aren't offered a rebate. If you use an online agency that gives you poor service, but with a rebate...you probably are being ripped off. But don't take away the agency that gives great service and is still able to pass along a healthy rebate for these costly cruises.

 

Just my opinion folks.

 

JAB

[rallydave]

but they do occur.

 

I appreciate the rebate, but the level of service is always the priority. Once the level of service drops (and I fear it might with changes in affiliations), then the rebate would be inconsequential. Having said that, I think the issue of rebates becomes more relevant as the price tag rises. Is the $20,000 cruise really that much more work for the TA than say a $699 Carnival cruise? Yet the differential for the TA is huge. It seems perfectly reasonable to pass some of this back to the customer. If the TA is able to make a reasonable profit and include rebates in the package, so much the better.

 

Just my opinion folks.

 

JAB

 

Couldn't agree more with the above analogy. While I do respect the comments made by the TA's, even $20K is probably lower than the average Luxury Cruise cost for a couple. Our TA is one who rebates 10% or more and we do all our own reservations other than the cruise booking. Using the 10% figure previously listed (our TA gets the 17%), a $1,000 Carnival/non-luxury cruise nets $100 for the TA and the agency. A $30,000 Luxury cruise nets the TA and agency $3,000 and for people not needing a lot of help from the TA fully understand the lack of a rebate on the non-luxury cruise but, for the luxury cruise with the $3,000 commission, a rebate of $1,000 to $2,000 is not unreasonable for the same or similar amount of work as the $100 commission is for the Carnival type cruise.

 

While the TA's did make a lot of sense in their comments, the value of the cruise need to be considered as well as the other points they made. Have no problem with my TA making $1,000 or more for what will probably be no more than 10 hours of work while I would feel bad taking any rebate for a $1,000 cruise.

 

My $.04 (inflation)

[Wendy The Wanderer]

Thanks JoAnne, great explanation. I'm in the same category as you are, same TA I believe.

[rlimbacher]

I am glad to see we are all deciding how much our TA's should make according to our feelings of their worth on the one sale. :confused: I do not mind the promotional shipboard credit, but totally disagree with the practice of rebating. The cruise lines never intended for this to be an accepted practice. If they wanted our TA to rebate, they would discount direct and bypass, but they do not. I am glad my TA retains her full commission from my purchases since it did not cost me any extra then if I purchased direct from Regent.

[rallydave]

I am glad to see we are all deciding how much our TA's should make according to our feelings of their worth on the one sale. :confused: I do not mind the promotional shipboard credit, but totally disagree with the practice of rebating. The cruise lines never intended for this to be an accepted practice. If they wanted our TA to rebate, they would discount direct and bypass, but they do not. I am glad my TA retains her full commission from my purchases since it did not cost me any extra then if I purchased direct from Regent.

 

No one is deciding how much our TA's should make based on anything. We are simply saying, if the offers are there, why not take the TA up on them. I was simply providing some examples of how rebating can make sense for an expensive cruise and not make sense for an inexpensive cruise. Every TA is free to rebate or not rebate depending on what a cruise line might tell them. We're also agreeing with you and the TA's that the amount of hand holding required by the TA should make a difference in rebating.

 

Oh but the cruise lines do discount including Regent. How many special fares, 2 for 1 plus additional $10,000 or whatever. Discounting and special deals are a way of life in the US. Would you go into a car dealer and pay full sticker when the next person gets $5,000 off sticker?? Why should one company, PCH tell other companies, TA's how much to sell their product for?? It's simply free enterprise. You keep paying full price and many of us will take the offers provided if they are offered.

[cwn]

JoAnn and RallyDave are right on in their comments.

 

Why shouldn't a person have the right to decide how much money to spend on a cruise. Buying a cruise especially a high end cruise is no different than buying any other big ticket item. Most people will price shop and go with the best deal for them...lots of service for more money or less service for a lower price (too simple but I think you can get the point). I know at least from the customer side I spend as much time with the TA buying a Carnival cruise as I do buying a Regent cruise. I cruise with both lines...just depends on what we are looking for.

 

If you want to pay the full price that you pay when you book through some agents or Regent or any criuse line, that is definitely your choice.

 

We just booked a Regent cruise and I did price shop. Regen Direct was the most expensive...no extra OBC period. The other 4 agencys ...two offerred OBC and a 5 to 10% rebate and two offerred about 5% in OBC.

 

We have worked hard for our money and are rather unwilling to spend it just because one seller isn't willing to offer us an incentive to go with them. So Regent Direct was out.

 

According to the Regent directives posted earlier, agents are allow to give OBC up to a %. They are not forbiden to rebate as long as they don't promote it in ads. So for my dollars, for our future cruise, I went with the agent offerring me the best deal for my $30,000+ cruise on Regent. Same way we did on the upcoming cruise on Seabourn. As far as my most recent cruise on Carinvsal with the grandkids....way less $$$ than either of the other two, I did get a little OBC...$100 from my agent which I would not have gotten if I had booked direct with Carnival.

 

Thank goodness at least for now we have choices in booking cruises.

[cwn]

Rallydave...exactly right!